Ch. 11: Irrevocable Offer

merchant

"Merchant" means a person who deals in goods of the kind or otherwise by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by his employment of an agent or broker or other intermediary who by his occupation holds himself out as having such knowledge or skill.

option contracts

An option is a contract that holds an offer open for a specified period of time. An option must be supported by consideration; otherwise, the offeror may revoke the offer.

part performance of a unilateral contract

Restatement (Second) of Contracts §45 (1) Where an offer invites an offeree to accept by rendering a performance and does not invite a promissory acceptance, an option contract is created when the offeree tenders or begins the invited performance or tenders a beginning of it. (2) The offeror's duty of performance under any option contract so created is conditional on completion or tender of the invited performance in accordance with the terms of the offer. *Analysis: (1) question of what's a merchant; (2) writing - email counts; signature includes email even if email is unsigned, and letterhead stationary.

promissory estoppel

Restatement (Second) of Contracts §90 (1)A promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. The remedy granted for breach may be limited as justice requires.

merchant's firm offer

UCC §2-205 An offer by a merchant to buy or sell goods in a signed writing which by its terms give assurance that it will be held open is not revocable, for lack of consideration, during the time stated or if no time is stated for a reasonable time, but in no event may such period of irrevocability exceed three months; but any such term of assurance on a form supplied by the offeree must be separately signed by the offeror. *only irrevocable for only three months/90 days. if merchant says only irrevocable for only 1 month, then it is only irrevocable for only 1 month. if merchant says irrevocable for 6 months, then only irrevocable for 3 months but the offer remains for the end of the 6 months

revocation

an offeror may freely revoke an offer before acceptance.

conditional promise

one where the promise is limited by a condition. The condition is the occurrence (or non-occurrence) of some event. The event could be nearly any type of occurrence. If the condition (i.e., the event) occurs, then the duty to perform the promise arises. If the condition does not occur, the promisor has not made a commitment to an action.

irrevocable offer

simply means that the offeror may not revoke during the irrevocability period. Any attempted revocation is ineffective, and the offeree retains the power of acceptance during this period of time. The list below consists of situations where a court may find that an offer has been made irrevocable. -Option Contracts -Conditional Contracts -Promissory Estoppel -Part Performance of a Unilateral Contract -Merchant's Firm Offer